New privacy rules expected for Internet providers (Update)
The federal government is proposing new privacy rules that would make Internet service providers such as cable and phone companies ask your permission in some instances before using and sharing your data.
Using customer information could help so-called ISPs make more money from targeted digital advertising, when advertisers are able to show you ads that they think will appeal to your specific interests.
The Federal Communications Commission's rules are likely to face criticism and possible lawsuits from Internet service providers.
The rules affect only companies that connect you to the Internet like Comcast, Verizon and Sprint. They do not apply to Internet companies that have huge advertising businesses based on customer data, like Facebook or Google. Those companies are regulated by the Federal Trade Commission.
FCC officials say their rules wouldn't "prohibit" targeted advertising from ISPs. But the aim is that in many, if not most, cases, your Internet provider would have to get your permission before sharing your personal data with advertisers.
The agency says you would only have to opt out, a less stringent requirement, if you were a customer of Verizon Fios, for example, and Verizon wanted to market Verizon Wireless services to you. But Verizon also owns a big digital ad business in AOL—if it wants to share data it collects from you with AOL, it needs your permission.
Privacy watchdogs applauded the FCC's effort.
"It's a major step forward for the U.S., which has lagged behind other countries when it comes to protecting consumer privacy rights," said Jeff Chester, executive director of the Center for Digital Democracy, in a statement.
Berin Szoka, the president of TechFreedom, a think tank that often criticizes telecoms regulation, says the rules are a bad idea. "The FCC loudly denounces certain privacy and business practices that sound bad, despite having little or no evidence that they don't offer any consumer benefits that should be weighed against potential harms."
The FCC also laid out new rules on how ISPs must protect your data from breaches and how fast they tell you about it if you are affected by a hack.
The agency's privacy framework relies on the reclassification of broadband service as a utility, which it did to enact net neutrality rules last year. The industry has sued to overturn the net neutrality rules. The net neutrality rules require ISPs to treat Internet traffic equally, not favoring one kind of site over another.
The FCC will vote on the privacy proposal at its meeting on March 31. That would kick off months of meetings and comments before any final rules are adopted.
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